Arch Capital estimates up to $95M in losses for virus claims
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Arch Capital Group Ltd. expects to see pre-tax losses across its property/casualty insurance and reinsurance segments of $85 million to $95 million for claims incurred due to the COVID-19 pandemic as of March 31, net of reinsurance recoveries and reinstatement premiums, the company said in a statement Thursday.
Arch also expects pre-tax net losses of $40 million to $50 million for its mortgage segment as a result of the financial stress created by the global pandemic, the statement said.
Arch said there are “significant uncertainties surrounding the ultimate number of claims and scope of damage resulting from this pandemic,” and that estimates are based on “currently available information derived from modeling techniques,” including proprietary economic models.
Estimates include losses only related to claims incurred as of March 31, 2020, the statement said.
In the wake of global market volatility, Arch said it also expects to report net investment income of $110 million to $115 million for the first quarter of 2020.
On Wednesday, Fairfax Financial Holdings Inc., which owns Crum & Forster, Allied World Assurance Co. Holdings Ltd. and several other insurers, said it expects to post a $1.4 billion loss for the first quarter of 2020 due to coronavirus-related investment losses.
More insurance and risk management news on the coronavirus crisis here.
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